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                                                                   Exhibit 10.32

                    SEPARATION AGREEMENT AND GENERAL RELEASE


                  This Separation Agreement and General Release ("Agreement") is
made as of April 21, 2005, between Enzon Pharmaceuticals, Inc., a Delaware
corporation, with offices in Bridgewater, New Jersey (the "Company" or "Enzon"),
and Kenneth J. Zuerblis ("Executive"), a resident of New Jersey.

                                   BACKGROUND

                  A. Executive is an Enzon employee who is voluntarily resigning
from his employment with Enzon;

                  B. Enzon desires to recognize Executive's material
contributions during  his employment; and

                  C. Executive and Enzon have been party to an employment
agreement dated as of June 14, 2004 (the "Employment Agreement");

                  D. Executive and Enzon wish to set forth the compensation
payable to Executive upon the termination of his employment as the Company's
Executive Vice President, Finance and Chief Financial Officer; and

                  E. Executive and Enzon desire to resolve any potential claims
or disputes arising from Executive's employment with Enzon or his voluntary
resignation from employment or the Employment Agreement.

                                      TERMS

                  In consideration of the mutual covenants and undertakings
contained herein, Executive and Enzon agree as follows:

                  1. Executive hereby resigns from his employment with Enzon,
effective April 21, 2005 (the "Separation Date").

                  2. Enzon agrees to pay the Executive a cash payment of
$320,000, which is equal to the Executive's annual base salary as of the
Separation Date, and such payment shall be made in a lump sum within 10 business
days after the end of the Rescission Period (as defined is Paragraph 19 below)
without revocation by Executive.

                  3. Enzon agrees to pay the Executive a cash payment of
$160,000, which is equal to Executive's Target Bonus (as defined in the
Employment Agreement) and such payment shall be made in a lump sum within 10
business days after the end of the Rescission Period without revocation by
Executive;

                  4. Enzon agrees to pay the Executive a cash payment of
$133,333, which is equal to the pro rata amount of the Target Bonus for the
fiscal year ending June 30, 2005, and such payment shall be made in a lump sum
within 10 business days after the end of the Rescission Period without
revocation by Executive.

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                  5. Enzon shall reimburse the Executive for the total
applicable premium cost for medical and dental coverage under the Consolidated
Omnibus Budget Reconciliation Act of 1986, 29 U.S.C. Sections 1161-1168; 26
U.S.C. Section 4980B(f), as amended, and all applicable regulations (referred to
collectively as "COBRA") for Executive and his spouse and/or dependents ("Family
Members") for a period of up to eighteen (18) months commencing on the
Separation Date and will reimburse Executive an amount equal to cost of
maintaining a comparable level of medical and dental coverage during the
eighteen (18) month period following such initial eighteen (18) month period
after the Separation Date; provided, that the Company shall have no obligation
to reimburse Executive for the premium cost of COBRA or comparable coverage as
of the date Executive and his Family Members become eligible to obtain
comparable benefits from a subsequent employer.

                  6. All options to acquire shares in the Company held by the
Executive as of the Separation Date shall vest and shall remain exercisable
after such date in accordance with the terms of the relevant plans and granting
instruments (to the extent any provision of this agreement conflicts with any
provision of any stock option plan or agreement between the Company and
Executive, the provision hereof shall take precedence). Notwithstanding,
anything to the contrary in this Agreement, the following options held by
Executive shall remain exercisable until the date which is eighteen months after
the Separation Date: (i) option granted December 2, 1997 to acquire 5000 shares
at $6.00 per share; (ii) option granted July 21, 1998 to acquire 70,000 shares
at $6.50 per share; (iii) option granted February 16, 2004 to acquire 50,000
shares at $14.15 per share; (iv) option granted March 26, 2004 to acquire 50,000
shares at $15.13 per share; and (v) options granted June 14, 2004 to acquire
25,000 shares at $12.27 per share. In addition, 27,500 shares of restricted
stock granted to Executive June 14, 2004 shall vest upon execution of this
Agreement.

                  7. The Executive shall continue to be entitled to any deferred
compensation and other unpaid amounts and benefits earned and vested prior to
the Executive's termination. Any such amounts shall be paid in accordance with
the provisions of the relevant plans. The Company shall pay or reimburse
Executive for all reasonable and necessary out-of pocket expenses incurred by
him in the performance of his duties through the date of this Agreement, subject
to the Company's normal policies for expense verification.

                  8. In consideration of the benefits accruing to Executive
under this Agreement, including the extended period of time to exercise certain
options, Executive agrees to consult with the Company through April 20, 2006, to
assist the Company and its auditors with, among other things, required filings
and certifications, such consultation to be under the direction of the Company's
Chief Executive Officer, and to involve a reasonable amount of time as required
for the services requested. Executive represents that to the best of his
knowledge there is no material weakness with respect to Enzon's internal
controls over financial reporting or recordkeeping practices or procedures. The
Company shall pay or reimburse Executive for all reasonable and necessary out-of
-pocket expenses incurred by him in the performance of his consulting duties
under this Paragraph 8, subject to the Company's normal policies for expense
verification.


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                  9. Executive's eligibility for any other Enzon benefits of any
kind will end effective as of the Separation Date.

                  10. Executive agrees that no additional compensation or
benefits of any kind shall be paid to him, and the compensation and benefits
provided to him under this Agreement shall be in full payment and satisfaction
of any and all financial obligations due to him from Enzon under the Employment
Agreement or otherwise. For purposes of clarity, this Paragraph 10 shall have no
effect on Executive's rights that have accrued under the Company's Executive
Deferred Compensation Plan. Executive shall be entitled to realize such rights
in accordance with the terms of such plan and his past elections thereunder.

                  11. It is understood and agreed that, by this Agreement,
Executive and Enzon intend to settle any and all claims which Executive or Enzon
has or may have against the other arising out of or resulting from Executive's
employment at Enzon and his resignation from such employment or the Employment
Agreement. Accordingly, in exchange for the benefits provided to Executive by
this Agreement, Executive, for himself, his heirs, successors and assigns (the
"Executive Releasees"), hereby voluntarily discharges and releases Enzon and its
affiliates, parent and subsidiary companies, and their respective officers,
directors, employees, agents, representatives, successors and assigns (the
"Enzon Releasees") from any and all claims or liabilities of any kind or
description, known or unknown, suspected or unsuspected, fixed or contingent,
which Executive ever had, now has or hereafter may have against each or any of
the Enzon Releasees by reason of any matter or event whatsoever occurring prior
to the date of this Agreement, including but not limited to any claims arising
out of or resulting from Executive's employment at Enzon or his separation from
such employment or the Employment Agreement. The release of claims specifically
includes, but is not limited to, claims arising under or based upon, the Age
Discrimination in Employment Act, the Older Workers Benefit Protection Act,
Title VII of the Civil Rights Act of 1964, the Civil Rights Act of 1991, the
Family and Medical Leave Act of 1993, the Employee Retirement Income Security
Act, the Rehabilitation Act of 1973, the Americans with Disabilities Act of
1990, the New Jersey Law Against Discrimination, the New Jersey Family Leave
Act, the New Jersey Conscientious Employee Protection Act, the Fair Labor
Standards Act, the New Jersey Wage and Hour Act, and/or any other state,
federal, or municipal employment discrimination statutes (including but not
limited to claims based on age, sex, attainment of benefit plan rights, race,
national origin, religion, handicap, sexual orientation, sexual harassment,
family or marital status, retaliation, and veteran status), and/or any other
federal, state, or local statute, law, ordinance, or regulation and/or pursuant
to any other theory whatsoever, including but not limited to claims related to
breach of implied or express employment contracts, including without limitation
the Employment Agreement, breach of the implied covenant of good faith and fair
dealing, defamation, wrongful discharge, constructive discharge, negligence of
any kind, intentional infliction of emotional distress, whistle-blowing, fraud,
estoppel or detrimental reliance, public policy, constitutional or tort claims,
violation of the penal statutes and common law claims, or pursuant to any other
theory or claim whatsoever, including claims for attorneys' fees, arising out of
or related to Executive's employment at Enzon or his resignation from such
employment or the Employment Agreement or any other occurrence from the
beginning of time to the date of this Agreement. This release excludes claims
arising after the Separation Date or the date this Agreement is fully executed,
whichever is later. Enzon, for itself and the Enzon Releasees, hereby
voluntarily discharges and releases Executive and the Executive Releasees from
any and all claims or liabilities of any kind or description, known or unknown,
suspected or unsuspected, fixed or contingent, which Enzon ever had, now has or
hereafter may have against Executive and each or any of the Executive Releasees
by reason of any matter whatsoever arising out of or resulting from Executive's
employment at Enzon or his separation from such employment or those portions of
the Employment Agreement.


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                  12. Each party agrees to reasonably cooperate with the other
with respect to transition matters. With respect to Executive, in addition to
consulting as provided in paragraph 8 above, this will include but not be
limited to: (a) responding to reasonable telephonic inquiries from Enzon
management concerning the transition of matters that Executive worked on during
his employ and (b) promptly notifying within a reasonable time Enzon's general
counsel, or his/her successor or designee, if Executive receives any legal
notices, subpoenaes or requests for information from any person or entity, other
than a representative of Enzon, concerning matters which arose during the period
of his employment with Enzon.

                  13. Each party agrees not to directly or indirectly make any
disparaging, untrue, or defamatory statements or communications (regardless of
medium) about the other. In the case of the Company, the preceding sentence
shall be limited to those statements properly made on behalf of the Company and
to those statements made directly or indirectly by any of its directors or
executive officers. In the event of a violation of this Paragraph 13, the
non-violating party may seek injunctive relief in addition to other damages.

                  14. Both parties agree that they will keep the specific terms
of this Agreement strictly confidential with the sole exceptions of Executive's
spouse, either party's attorney(s) or tax advisor(s), Enzon's independent
auditors (all of whom agree to keep the terms confidential), or as may be
required by law including disclosure requirements under applicable securities
laws or as necessary in any legal proceeding to enforce or prosecute a party's
rights.

                  15. Except as provided in this Paragraph 15, the Employment
Agreement is terminated and of no further force and effect as of the date of
this Agreement. Notwithstanding the preceding sentence and anything contrary in
this Agreement, the following sections of the Employment Agreement shall survive
in accordance with their terms, as such sections may be amended by the terms of
this Agreement: Sections 5, 6, 7 and 8. The Noncompete Period as described in
Section 5(a) of the Employment Agreement with respect to any activity covered by
clause (y) or (z) in section 5(a)(ii) of the Employment Agreement, will end on
April 20, 2006, and with respect to any activity covered by clause (z) in such
Section 5(a)(ii)), the Noncompete Period will end on April 20, 2007. Enzon
acknowledges and agrees that the Indemnity Agreement between Enzon and Executive
shall remain in full force and effect according to its terms.

                  16. Executive agrees that, no later than May 15, 2005, he
shall deliver to Enzon all books, records, notes, documents and other written or
computer generated materials of any nature whatsoever relating to Enzon's
business and any other Enzon property in his possession or within his control
(e.g., credit cards, equipment, office keys). Executive agrees that he shall not
keep in his possession or control any of Enzon's property of any kind.


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                  17. Both parties acknowledge and represent that they fully
understand this Agreement, that they have had adequate and reasonable
opportunity to review the Agreement, that they were advised to consult with
independent counsel of their choice before signing it, and that they are signing
it voluntarily.

                  18. Executive acknowledges that the terms of this Agreement
shall be open for acceptance by him for a period of twenty-one (21) days during
which time he may consider whether to accept this Agreement.

                  19. Executive further acknowledges and agrees that he may
cancel or revoke this Agreement within seven (7) days after signing it (the
"Rescission Period"). To be effective, any notice of cancellation or revocation
must be in writing and delivered either by hand or mail prior to the end of the
Rescission Period to Mr. Paul S. Davit at Enzon. If delivered by mail, the
notice of cancellation or revocation must be (a) post-marked prior to the end of
the Rescission Period ; (b) properly addressed to Mr. Paul S. Davit, Enzon
Pharmaceuticals, Inc., 685 Route 202/206, Bridgewater, New Jersey 08807; and (c)
sent by certified mail, return receipt requested. Executive acknowledges and
agrees that if he exercises his right of cancellation or revocation, Enzon shall
be relieved of all obligations undertaken in this Agreement, including, without
limitation, any payments hereunder.

                  20. The terms and conditions of this Agreement may not be
altered, amended or modified except by a writing duly executed by both Executive
and Enzon.

                  21. Except as otherwise stated herein, this Agreement contains
the entire understanding between Executive and Enzon with respect to the
termination of Executive's employment at Enzon. There are no covenants,
representations or undertakings with respect to such termination other than
those expressly set forth or referenced in this Agreement.

                  22. If any portion of this Agreement is found by a court of
competent jurisdiction to be void and unenforceable, such portions shall be
deemed to be severable from the Agreement and shall have no effect on the
remaining sections of this Agreement.

                  23. This Agreement shall be governed and construed in
accordance with the laws of the State of New Jersey without regard to its choice
of law or conflicts of law rules. In the event of any proceedings arising out of
this Agreement, the prevailing party shall be entitled to reasonable attorneys
fees and costs.

                  24. This Agreement has been reviewed and negotiated by both
Executive and Enzon, and no provision of this Agreement shall be construed
against either party on the ground that such party was the drafter of that
provision or the Agreement.

                  25. This Agreement shall be binding upon Executive and Enzon
upon its execution by them and shall inure to the benefit of their respective
heirs, successors and permitted assigns.


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                  IN WITNESS WHEREOF, the parties have duly executed this
Separation Agreement and General Release or caused it to be executed by duly
authorized representatives as of the dates set forth below.

ENZON PHARMACEUTICALS, INC.



By: /s/ Paul Davit                          /s/ Kenneth J. Zuerblis
    ------------------------------        -----------------------------------
     Name:                                  Kenneth J. Zuerblis

Title: EVP, Human Resources
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Date: 4/26/05                            Date: 4/27/05
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